The Securities and Exchange Commission issued a final rule package Thursday that eliminates some financial disclosures and updates requirements for reporting related to liquidity and accounting estimates, but doesn’t address pleas to require climate change reporting.
In a 3-2 vote, commissioners approved a measure to update and streamline requirements for the management’s discussion and analysis portion of financial reports, part of an ongoing efforts to modernize its disclosure rules.
- In a statement, Chairman Jay Clayton said the rules will give investors better insight into the factors that drive how the business is managed while reducing compliance costs for statement preparers.
- Commissioners Allison Lee and Caroline Crenshaw opposed the package. Lee previously criticized it for not addressing climate change reporting and for eliminating what she said were significant disclosures.
- Under the final rules, which amend Items 301, 302, and 303, companies will no longer have to report five years of certain financial data or include a table detailing contractual obligations, but they have updated requirements for liquidity and capital resources disclosures.
- Investors told the SEC that the changes will strip away key disclosures they relied on during the spring shutdowns as companies furloughed workers and revenue dropped.